Litman: Are Jan. 6 investigators hot on the trail of ‘all the president’s people’?
Good question. Here’s what we know: Enron will pay $30 million to settle civil charges that it underreported $1.1 billion in profits in 2000; California officials and other taxpayers spent $1.5 billion to investigate Enron’s collapse; Enron’s CEO resigned from the company’s Board of Directors in January to avoid prosecution; Enron has had $1 billion in write-downs from its investment portfolio.
If we do the math, the price tag could approach as much as $5 billion. But you know who gets to pay for that? You. And you. And you.
By the way, here’s what I did:
First, I plugged in Enron’s 2001 non-GAAP net income using the company’s internal revenue recognition policy of net income of the consolidated group.
Next, I applied Enron’s 2001 and 2000 EPS growth rates for each of the three years — 2.1% for 2001, 1.7% for 2000, and 2.4% for 1999 — to Enron’s net income (net of special charges) to produce the company’s 2001 and 2000 NIP.
I then used the company’s non-GAAP financial measure of NIP growth to calculate non-GAAP non-GAAP net income for 2001 (using the same method) and adjusted the non-GAAP net income to exclude Enron’s $1.6 billion write-down of its investment portfolio in July.
I then used the same method to calculate the 2001 and 2000 non-GAAP non-GAAP net income.
Enron’s 2001 non-GAAP NIP, adjusted to exclude the write-down of investment portfolio, was $2.04
